Corruption of the Bahraini regime: successive government loans of unknown fate
Al-khalifa regime accumulates the Bahraini people’s wealth in their bank accounts without minimal supervision or legal consequences, as successive governments continue to consume loans and pile up debts in the people’s name.
The Bahrain Mirror website highlighted that about one billion dinars (2.6 billion dollars), no one knows about its fate so far in the state’s accounts for the past year 2021. Only the ruling family can answer where this large amount went.
The Bahraini government borrowed one billion and 512 million dinars (4 billion dollars) last year, while the scheduled deficit was only one billion and 200 thousand dinars.
This means that the government borrowed 312 million Bahraini dinars over its need to pay the specified deficit in the state’s general budget, so what is the justification for borrowing this amount and where it will go?
Not only that, but the government reaped more than an additional 600 million dinars last year from high oil prices.
As usual, the government adopted a conservative price in the state budget for 2021 at $50 a barrel, but oil prices rose on average last year to reach $70, an estimated increase of about 40%.
Suppose we add the two figures of 312 million dinars (borrowing surpluses) and 600 million dinars (the difference in oil prices); you will find that the state has a surplus over last year estimated at one billion dinars.
All of that happened last year, and no one knows when we are in the middle of 2022 where the billion dinars went.
If this amount was spent on housing projects, it would be sufficient to build 25 thousand housing units from the units whose construction is supervised by the Ministry of Housing, but there is no impact on the lives of citizens.
This is not the first time the Bahraini government has borrowed more than it needs. In 2017 and 2018, it borrowed about an additional billion dinars, and the government did not provide any explanations.
We are facing a situation that is repeated annually, and no one has the right to ask the government and the King, the head of the authorities, why and where this enormous amount of money is spent?
No one but the family has the answer to borrowing in a time of high oil prices. Why did Bahrain resort to borrowing 2 billion dinars last November in light of the rise in oil?
And no one knows whether the government will cancel its plans to borrow this year after the International Monetary Fund estimated a 39% increase in its revenues, which means that it will record surpluses of up to 3 billion dinars?
Where will the government spend the 2022 oil surplus and double aluminium revenue?
Over the past years, the country’s finances have been burdened with debts that it does not need due to these legalized thefts until the public debt, according to official figures, reached 14.6 billion dinars, a quarter of which could have been avoided at least.
As a result of this policy, debt service amounted to 750 million dinars, borne annually by the state’s finances. It is the most oversized expenditure item in the general budget!
While the citizen bears these financial burdens in terms of taxes and fees, the decline in health, education and housing services and the increase in the number of the unemployed, the fortunes of King Khalifa bin Hamad and his sons are growing.
A Kuwaiti economic report expected Bahrain’s budget for 2022 to record a surplus for the first time in 14 years, supported by the rise in crude oil prices.
The report issued by the National Bank of Kuwait on Bahrain’s economy said: “The rise in oil production and prices will boost Bahrain’s economic growth rate to 3% in 2022, exceeding the pre-Coronavirus GDP growth rate of 2.2%.”
The report added that “the budget tends to record a surplus this year, exceeding the goal of achieving balance by 2024.”
However, he pointed out that the continued rise in government debt levels remains one of the primary sources of concern and the possibility of a decline in oil prices.
Although Bahrain is considered one of the most diversified economies in the Gulf region, it will benefit more than others from rising oil revenues; Given the weaknesses in the public finances.
Bahrain’s economy has faced significant challenges over the past years, and this crisis has worsened during the Corona pandemic. Still, the $ 10 billion Gulf support that Manama received in 2018 has helped to confront these pressures relatively, while government corruption remains the most prominent obstacle to any natural economic recovery.